Oriole Company, a machinery dealer, leased a machine to Pharoah Corporation on January 1, 2025. The lease is for an 8-year period and requires equal annual payments of $22,300 at the beginning of each year. The first payment is received on January 1, 2025. Oriole had purchased the machine during 2024 for $160,000. Collectibility of lease payments by Oriole is probable. Oriole set the annual rental to ensure a 6% rate of return. The machine has an economic life of 10 years with no residual value and reverts to Oriole at the termination of the lease. Assume that Pharoah Corporation does not know the rate implicit in the lease used by Oriole, and Pharoah's incremental borrowing rate is 8%. In addition, assume that Pharoah incurs initial direct costs of $16,000. Click here to view factor tables. repare all necessary journal entries for Pharoah for 2025. (List all debit entries before credit entries. Credit account titles are utomatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and Enter 0 for the amounts. Round answers to O decimal places eg. 5,275. Record Journal entries in the order presented in the problem.) Date Account Titles and Explanation 1/1/25 Lease Receivable 1/1/25 12/31/25 v Cost of Goods Sold Sales Revenue (To record the lease) Cash Lease Receivable (To record the first lease payment) Interest Receivable Interest Revenue (To record interest expense) 12/31/25 v Amortization Expense Debit 148787 22300 Credit 22 C Qu Acc Que Accou tion 8 of 11 12/31/25 v Lease Receivable (To record the first lease payment) Interest Receivable Interest Revenue (To record interest expense) 12/31/25 v Amortization Expense Accumulated Depreciation-Right-of-Use Asset (To record amortization of the right-of-use asset) 22